The world's largest software maker is on track to launch its touch-friendly Windows 8 operating system this autumn and wants to make a big impact with its own device to kickstart demand.

The tablet will come in two versions, one running on traditional Intel Corp chips, and another using ARM Holdings. Both will have a fold-out cover that becomes a keyboard.

A prototype was demonstrated by Microsoft Chief Executive Steve Ballmer at an event in Los Angeles. The tablets will be available when Windows 8 ships later this year, according to a Microsoft statement.

No details on pricing were mentioned, except that it would be "comparable" with current ARM tablets and Intel-powered Ultrabooks.

Microsoft shares rose slightly in after-hours trading. They closed down 0.6 percent at $29.84 in the regular Nasdaq session.

Launching its own tablet potentially throws Microsoft into direct competition with its closest hardware partners such as Samsung Electronics Co Ltd and Hewlett-Packard Co.

Sales of tablets are expected to triple in the next two years, topping 180 million a year in 2013, easily outpacing growth in traditional PCs. Apple has sold 67 million iPads in two years since launch. (See graphic, link.reuters.com/myc88s)

Apple, which makes both hardware and software for greater control over the performance of the final product, has revolutionized mobile markets with its smooth, seamless phones and tablets. Rival Google Inc may experiment with a similar approach after buying phone maker Motorola Mobility this year.

Reporting By Lisa Richwine in Los Angeles and Bill Rigby in Seattle; Editing by Bernard Orr